Gabriel Resources Ltd.: Third Quarter Report

Gabriel Resources Ltd. (TSX:GBU) ("Gabriel" or the "Company") announces the
publication of its Third Quarter Financial Statements and Management's
Discussion and Analysis Report for the period ended September 30, 2013.  


Summary of Recent Events 

Capitalised terms used in this summary section are defined in "Further
Information" below




--  On September 17, 2013, Parliament established a Special Joint Committee
    of the Senate and of the Chamber of Deputies with an objective to (a)
    examine the Draft Law initiated by the Government, as well as any
    amendments submitted by the Government, deputies and senators; (b)
    prepare a report for discussion in each Chamber; and (c) facilitate a
    decision on the adoption of the Draft Law in a plenary session of each
    Chamber. 
    
--  On November 11, 2013 the Special Committee issued its report on the
    Draft Law which will be submitted to the Senate of the Parliament for
    debate and an advisory vote before it is passed to the Chamber of
    Deputies for a final binding vote of Parliament. The Special Committee
    considered it necessary to undertake a wide debate and analysis of the
    Project and, accordingly, issued numerous conclusions and
    recommendations in the Report, which are summarized in "Further
    Information" below. 
    
--  The conclusions of the Report do not propose a rejection of the Project
    by the Parliament but the creation of a new general legal framework
    applicable to gold and silver mining projects in order to stimulate the
    implementation of such projects and attract investment. However the
    Special Committee voted in favour of a recommendation for the rejection
    of the Draft Law. 
    
--  The Company notes the Special Committee's proposal for the creation of a
    new generic legal framework applicable to gold and silver mining
    operations such as the Project, an initiative to address the recognised
    deficiencies in the current legal framework for the evaluation and
    development of large-scale mining operations such as the Project. The
    Company will monitor the development of this initiative closely, whilst
    actively considering all possible opportunities in the interests of its
    stakeholders. 
    
--  A number of the recommendations presented by the Special Committee have
    already been addressed extensively by the competent authorities or
    institutions charged with assessing the Project, such as the Technical
    Analysis Committee, however the Company is fully committed to working
    with the relevant ministries and Government institutions, as
    appropriate, to clarify issues raised in the Report. 
    
--  RMGC has initiated a defamation suit in response to completely
    ungrounded accusations made before the Special Committee concerning the
    falsification of certain maps relating to the Corna Valley basin and
    will examine all possible legal action to counter such unfounded
    allegations and protect its rights. 
    
--  Whilst some of the conclusions and recommendations of the Special
    Committee may be positive for the development of the Project, certain
    conclusions and recommendations, if acted upon, may cause unspecified
    delay in the permitting process and/or necessitate changes to the terms
    of the License and/or the existing joint venture arrangements between
    Gabriel and Minvest RM. 
    
--  Until such time as the Company can complete the extensive dialogue
    necessary with the relevant ministries of the Government regarding the
    ultimate outcome of the Parliamentary Review, Gabriel cannot provide any
    assurances or estimates of the likely time required to address and
    resolve such matters or as to the impact of such resolution on the
    permitting progress of the Project. 



Q3 Summary



--  The Government has deferred the decision on the environmental permitting
    of the Project until after the conclusion of the Parliamentary Review
    and the recommendation of the Ministry of Environment. The Company is
    unable to provide guidance on the related timeframes to a final decision
    from the TAC, MoE or the Government. Ultimately, the EP must be approved
    by a Cabinet decision of the Government prior to its issuance. 
    
--  Visits to Rosia Montana included delegations from the Ministry of
    Culture and from the Romanian Parliamentary Commission for UNESCO. After
    this visit the reported view of the Minister of Culture was that the
    Project had no chance to be included in the UNESCO heritage list at this
    time, and the chances will be higher in future years if the old
    galleries are preserved and the old buildings are restored, as is the
    intention of the Company should the Project proceed. 
    
--  During Q3 2013, the Company continued, at its own cost, with programmes
    for the maintenance of 160 houses, and the complete restoration of more
    than 110 houses, located within the historical center of the village of
    Rosia Montana ("Protected Area"), as well as continuing further detailed
    archaeological work focusing on opening up previously unexplored old
    underground mining galleries. Subject to internal fit out, the primary
    restoration of the former town hall was completed during 2012. 
    
--  On July 18, 2013, a refund of RON 13.4 million ($4.0 million equivalent)
    was received from the Romanian fiscal authorities in respect of taxes,
    penalties and interest previously paid. 
    
--  $56.2 million of cash and cash equivalents was held as at September 30,
    2013. 



Jonathan Henry, Gabriel's President and Chief Executive Officer, stated:

"The inclusion of the Project within Romania's National Plan for Strategic
Investment and Job Creation and the Parliamentary Review has shown that the
Government is serious about economic growth for Romania. Gabriel will now assess
the impact of the Report and the Government's revised strategy on initiating and
implementing a new framework legislation for gold and silver mining." 


Further information and commentary on the operations and results in the third
quarter of 2013, together with events anticipated in the short term, is given
below. The Company has filed its Unaudited Condensed Interim Consolidated
Financial Statements and Management's Discussion & Analysis on SEDAR at
www.sedar.com and each is available for review on the Company's website at
www.gabrielresources.com.


Further Information

Financial Performance



--  The net profit for the third quarter of 2013 was $2.1 million. 



Liquidity and Capital Resources



--  Cash and cash equivalents at September 30, 2013 amounted to $56.2
    million. 
    
--  During Q3 2013, the Company issued 0.1 million common shares upon the
    exercise of Deferred Share Units, with nil proceeds. No stock options
    were exercised. 
    
--  Excluding realized foreign exchange translation differences and the July
    2013 tax refund, the Company's average monthly net cash usage during Q3
    2013 was $3.5 million (Q2 2013: $3.2 million). 
    
--  During 2013 the Company has continued with its underlying cost
    containment, following implementation of cost reduction measures
    initiated in mid-2012, to preserve capital until such time as the
    Government moves ahead with Project permitting. However, increased
    activity levels associated with permitting and communications activities
    following the announced Parliamentary Review during the latter part of
    Q3 2013 are expected to continue to increase cash usage throughout Q4
    2013. 



Capital Cost



--  Including interest, financing and corporate costs, the Company estimates
    the capital required to bring the Project into production and to a
    position of positive cash flow is approximately US$1.5 billion. 



Political Environment 



--  On December 9, 2012, scheduled parliamentary elections brought an
    overwhelming victory for the 'USL' alliance of the Social Democrat,
    National Liberal and Conservative parties, led by Social Democrat leader
    Victor Ponta. The USL gained two thirds of the parliamentary seats - a
    position facilitating majority control in both chambers (the 'Senate'
    and the 'Chamber of Deputies') of the Parliament of Romania
    ("Parliament").  

--  The first half of 2013 saw the USL add definition to its program for its
    4-year governmental term, which manifested itself in an announcement by
    Mr. Ponta on July 11, 2013 of a National Plan for Strategic Investment
    and Job Creation (the "Plan"). In the Plan, Mr. Ponta set out key
    targets for 2013, including investment commitments into Romania of EUR10
    billion and the creation of over 50,000 jobs in five strategic
    investment fields. Seven projects within the mineral resources field
    have been identified for focus by the Government in order to achieve
    those targets, of which one is the Project. 

--  In its meeting on August 27, 2013, the Government approved a draft law
    "on certain measures related to the exploitation of the gold-silver
    deposits from Rosia Montana and stimulation and facilitation of mining
    development in Romania" (the "Draft Law") for debate and adoption by
    Parliament. 

--  On September 5, 2013, the Draft Law was formally presented to Parliament
    for consideration by both the Senate and Chamber of Deputies (the
    "Parliamentary Review"). On September 17, 2013, Parliament established a
    Special Joint Committee of the Senate and of the Chamber of Deputies
    (the "Special Committee"). The Special Committee was given an objective
    to (a) examine the Draft Law initiated by the Government, as well as any
    amendments submitted by the Government, deputies and senators by no
    later than October 1, 2013; (b) prepare a report for discussion in each
    chamber; and (c) facilitate a decision on the adoption of the Draft Law
    in a plenary session of each Chamber. 

--  The findings, conclusions and proposals of the Special Committee were
    due to be submitted to the plenary of the Senate by October 20, 2013;
    this deadline was subsequently amended to November 10, 2013. 



Report of the Special Committee



--  On November 11, 2013 the Special Committee published its report on the
    Draft Law (the "Report"), and voted in favour of a recommendation for
    the rejection of the Draft Law by seventeen votes "for" and with two
    abstentions. This recommendation is now expected to be debated in the
    Senate of the Parliament, before the Report and the Draft Law are sent
    to the Chamber of Deputies, as the decision-making body charged with
    voting on its adoption. 

--  Notwithstanding the foregoing, the conclusions of the Report do not
    propose a rejection of the Project by the Parliament. 

--  The Special Committee considered it necessary to undertake a wider
    debate and analysis of the Project and, accordingly, issued numerous and
    wide-ranging conclusions and recommendations in the Report, including
    amongst others, the following: 
    
    --  a recommendation that Parliament creates a new general legal
        framework applicable to gold and silver mining projects in order to
        stimulate the implementation of such projects and attract
        investment, acknowledging that the existing mining law is not
        sufficient to legislate for the scale and complexity of the Project.
        
    --  an acknowledgement that the development of a stable and predictable
        royalty regime for natural resources' projects must be a priority of
        economic policy-making in Romania. 
        
    --  recognition of the improvements to the economic benefits that the
        Project is forecast to provide to the Romanian State, as promoted by
        the Government through the Draft Law, compared to those which the
        Romanian State enjoys under the terms of the existing exploitation
        license for the Project ("License"). 
        
    --  recommendations that any future agreement should include enhanced
        protections for the State regarding, amongst other matters, extended
        shareholder veto rights, increased assurances of revenue returns
        from the Project's operations and financial guarantees. 
        
    --  a recommendation for the declassification and disclosure of the
        License. 
        
    --  a recommendation that the competent authorities should analyze and,
        where appropriate, investigate the evolution of the joint venture
        arrangements between the Company and Minvest, including the initial
        tender and transfer processes of the late 1990s through which Rosia
        Montana Gold Corporation ("RMGC") ultimately acquired the License
        and the Company acquired its current indirect equity interest in
        RMGC, and the process through which the License has been amended
        since its issuance in December 1998. 
        
    --  a recommendation that the competent authorities should analyze and,
        where appropriate, investigate the statements made before the
        Committee by the former director general of the Romanian Institute
        of Geology, Mr. Stefan Marincea, with regard to the alleged
        falsification of the maps for the Corna Valley basin (see below). 
        
    --  a recommendation that specific ministries verify certain statements
        made by interested parties during the Committee hearings related to
        the potential risks associated with (i) the use of cyanide in mining
        operations, including an assessment of the possibility of using the
        alternative technology of cyanidation through flotation (ii) dam
        safety and (iii) permeability of the Project's Tailings Management
        Facility ("TMF"). 
        
    --  a recommendation that the Parliament examines the opportunity to
        amend the legislation, so as to avoid the use of exploitation
        technologies in the mining industry that could compromise the
        possibility to exploit other commercially valuable mineral
        resources. 
        
    --  a recommendation that the Ministry of Culture organizes a public
        consultation in order to present a competent point of view regarding
        the potential dangers which may occur in relation to the cultural
        and historical heritage in Rosia Montana and initiates a public
        debate on the eligibility of Rosia Montana for inclusion on the
        UNESCO Heritage list. 
        
--  The Company notes the Special Committee's proposal for the creation of a
    new generic legal framework applicable to gold and silver mining
    operations such as the Project, an initiative to address the recognised
    deficiencies in the current legal framework for the evaluation and
    development of large-scale mining operations such as the Project. The
    Company will monitor the development of this initiative closely, whilst
    actively considering all possible opportunities in the interests of its
    stakeholders. 
    
--  A number of the recommendations presented by the Special Committee in
    response to concerns raised by interested parties during the Special
    Committee hearings, particularly relating to the preservation of
    cultural heritage, the risks of cyanide use and alternative
    technologies, and the safety of the TMF, have already been addressed
    extensively by the competent authorities or institutions charged with
    assessing the Project, such as the Technical Analysis Committee.  
    
--  The Company is fully committed to working with the relevant ministries
    and Government institutions, as appropriate, to clarify the above issues
    and others raised in the Report. Gabriel, together with is advisers, has
    already commenced the process of addressing a number of the Report's
    conclusions and recommendations. 
    
--  RMGC has initiated a defamation suit against the former director general
    of the Romanian Institute of Geology (IGR), Mr. Stefan Marincea, on
    November 12, 2013 in response to the completely ungrounded accusations
    made by Mr. Marincea before the Special Committee concerning the
    falsification of certain maps relating to the Corna Valley basin. The
    Company, through RMGC, will examine all possible legal action to counter
    such unfounded allegations and protect its rights. 



Impact on the Project



--  Whilst some of the conclusions and recommendations of the Special
    Committee may be positive for the development of the Project, certain
    conclusions and recommendations, if acted upon, may cause unspecified
    delay in the permitting process and/or necessitate changes to the terms
    of the License and/or the existing joint venture arrangements between
    Gabriel and Minvest RM. 

--  Until such time as the Report and Draft Law are sent to the Chamber of
    Deputies and the Company can complete the extensive dialogue necessary
    with the relevant ministries of the Government regarding the ultimate
    outcome of the Parliamentary Review, the Company cannot provide any
    assurances or estimates of the likely time required to address and
    resolve such matters or as to the impact of such resolution on the
    permitting progress of the Project. 



Project Ownership and Royalty Rates



--  In accordance with the terms of a reorganization of Minvest's business
    approved by the Government on April 30, 2013, Minvest transferred its
    entire direct 19.31% shareholding in RMGC to Minvest Rosia Montana S.A.
    ("Minvest RM"), a wholly-owned state entity. On November 1, 2013 the
    shareholders of RMGC formally approved the transfer of the shareholding
    in RMGC from Minvest to Minvest RM. 
    
--  The Company announced on July 12, 2013 that it was in negotiations with
    the Government on an increase in the Romanian State's equity interest in
    the Project and royalties, along with other long-term commitments on
    environment, cultural heritage and a defined route to successful
    permitting to underpin the Project's status as a world-class, long-term
    and sustainable investment. The measures proposed by the Draft Law, as
    announced by the Government, included a detailed agreement between RMGC
    and the Government cover those issues and the following terms: 
    
    --  the transfer by the Company, upon obtaining certain milestones in
        the permitting process, of 5.69% of the share capital of RMGC to the
        Romanian State, such that its indirect interests will increase to
        25%, with the Company retaining a 75% ownership; and 
        
    --  an increase in the mining royalty applicable to the Project from 4%
        to 6% of revenues. 
        
--  As noted above, the Report includes, amongst others, acknowledgements
    that the development of a stable and predictable royalty-regime for
    natural resources' projects must be a priority of economic policy-making
    in Romania and that the economic benefits to the Romanian State are
    improved compared to those which it enjoys under the terms of the
    existing exploitation license for the Project. 
    
--  On November 14, 2013 it was reported that an emergency ordinance had
    been approved by the Government to set new royalties for mineral
    resources, to be applied from 2014 upon either (i) the conclusion of a
    license or (ii) the issuance of a mining permit. For noble metals,
    including gold, it is reported that a royalty of 6% of the mining
    production value will be applied. Until such time as the ordinance is
    recognized in the Official Gazette in Romania and an addendum to the
    License is agreed by RMGC, it is the Company's understanding that the
    royalty rate of 4% established in the License will continue to apply to
    the Project. 



 Environmental/Permitting



--  The Company's understanding remains that Government approval of the
    environmental permit ("EP") is pivotal to the permitting progress of the
    Project. Furthermore, a key factor in the Government decision is the
    recommendation of the Technical Assessment Committee ("TAC"), originally
    charged with the detailed review of the environmental impact assessment
    ("EIA") and compliance of the Project; the TAC having met most recently
    on four occasions in May, June and July 2013. The Company remains
    confident that it will comply with, and in some aspects exceed, its
    obligations under European and Romanian laws for environmental
    protection and guarantees. 

--  Through its decision of August 27, 2013, the Government deferred the
    substantive in-principle decision affecting the environmental permitting
    of the Project until after the conclusion of the Parliamentary Review
    and the recommendation of the Ministry of Environment. Whilst the
    Company awaits the outcome of the Parliamentary Review, it will seek
    engagement with the Government on its strategy for addressing the
    findings of the Special Committee and the initiative to create a new
    legislative framework for gold and silver mining projects. The Company
    will also request confirmation from the relevant authorities of the
    status of, amongst other matters, the environmental permitting procedure
    for the Project. 

--  At this time the Company remains unable to provide guidance on the
    related timeframes to a final decision from the TAC, MoE or the
    Government. Ultimately, the EP must be approved by a Cabinet decision of
    the Government prior to its issuance. 

--  The Company has instigated a number of environmental initiatives in
    recent years to show how the implementation of the Project can assist
    with cleaning up legacy local environmental degradation from historical,
    unregulated mining activities. One such initiative is an acid rock
    drainage pilot test work program to clean mine water contaminated with
    high levels of heavy metals and total dissolved solids above EU and
    Romanian water standards. These tests have been conducted on water
    courses in Rosia Montana that are currently adversely affected by
    existing acid mine drainage from historic mining activities. The results
    have successfully shown that a full scale plant will clean up water
    discharges from the Project, along with much of the existing baseline
    contamination in the area, to levels fully compliant with all
    regulations in place (and even to potable water standards). 

--  Since late 2012, the Company has been working with the requisite
    Government agency to use the pilot plant for additional testing of eight
    former state-run mine sites and has demonstrated that a full scale water
    treatment plant would be successful in cleaning up the contaminants to
    the required EU and Romanian standards at all sites tested. This is one
    example of how the Project, and the commitments made in the EIA, will
    produce long-term environmental benefits at local, regional and national
    levels. 

--  The Company's amended industrial zonal urbanism plan ("Industrial Area
    PUZ") is at an advanced stage, and currently there are 19 valid
    endorsements of the 23 required for its approval; the Company has
    submitted the necessary documentation for two further endorsements and
    is progressing with the submission of documents for the remaining two.
    After obtaining all the necessary endorsements, the final approval for
    the Industrial Area PUZ will be given by the local councils of Rosia
    Montana, Abrud and Bucium. 

--  In addition, 10 out of the total of 13 endorsements necessary for the
    final approval of the zonal urbanism plan for the Rosia Montana
    historical protected area ("Historical Area PUZ") had been obtained at
    the end of Q3 2013, with the remainder being a documentary work in
    progress. 

--  While the Company understands there is no formal link between the
    receipt of remaining endorsements for the Industrial Area PUZ, the
    Historical Area PUZ and the EIA review process, it believes that these
    respective remaining endorsements are likely to be obtained on, or
    after, the issuance of the EP. 



Archaeology and Preservation of Cultural Heritage



--  The Company continues, at its own cost, with maintenance work on 160
    houses identified in the historical center of the village of Rosia
    Montana ("Protected Area"), with the aim of preventing their
    deterioration. While these village houses are not designated as
    historic, the restoration will contribute to maintaining the character
    of the village. 
    
--  The Company is advancing a project to complete restoration of more than
    110 houses located within the Protected Area, which will bring these
    back into functional use. To date, the design work and permitting has
    been completed, with the final stage for obtaining construction
    authorization yet to be initiated. 
    
--  RMGC, in partnership with the local council of Rosia Montana, initiated
    the restoration of two iconic buildings in the Protected Area which will
    be used for tourism initiatives. Subject to internal fit out, the
    primary restoration of the former town hall was completed during 2012.
    Work on the old school house advanced to the stage of the building being
    secure and weather tight. Further restoration work has been put on hold
    until such time as the Government moves ahead with Project permitting. 
    
--  RMGC is continuing further detailed archaeological work focusing on
    opening up previously unexplored old underground mining galleries that
    lie under the Protected Area, such as Catalina Monulesti. Such areas
    will serve as a permanent museum, a visible testimony to the 2,000 year
    mining history at Rosia Montana and an accessible example of historic
    mining activities for parties with interests in the regional mining
    sector. The Company has already hosted over one thousand visitors to
    Catalina Monulesti, representing various stakeholder groups. The
    archaeological results identify Roman mining galleries and related
    wooden artifacts, all outside of the Project footprint. This is all part
    of the long term initiatives in the Protected Area funded solely by the
    Company. Without such programs, there would be no comparable
    preservation of the area's mining heritage. 
    
--  During Q3 2013, visits to Rosia Montana included delegations from the
    Ministry of Culture and from the Romanian Parliamentary Commission for
    UNESCO. After this visit the reported view of the Minister of Culture
    was that the Project had no chance to be included in the UNESCO heritage
    list at this time, and the chances will be higher in future years if the
    old galleries are preserved and the old buildings are restored, as is
    the intention of the Company should the Project proceed. 



Corporate and Social Responsibility (CSR)



--  The Company continues to pursue a strategy of engagement with all
    stakeholders to explain the critical importance of the Project as part
    of the sustained economic development for Romania and its commitment to
    adhere to the highest standards on engineering, environmental, cultural
    and social matters, which will allow the Project to become a showcase
    for further investment into Romania and a sustainable legacy for the
    Romanian people. 
    
--  Gabriel takes pride in its commitment to achieving the highest levels of
    sustainability from workplace safety to community and environmental
    responsibility. The Company invests significant resources into its CSR
    programs, which in Romania is a multi-dimensional commitment managed by
    RMGC covering employee training and safety, local communities, living
    traditions, direct and indirect social impacts, educational programs,
    environmental protection, community sponsorship and heritage aspects. 
    
--  One of RMGC's core commitments is to develop local employment, local
    supply and a strategy for local economic diversification during the life
    of the Project for sustainable development for the benefit of future
    generations, evidenced through: 
    
    --  Local employment - RMGC currently employs approximately 500 people
        directly and numerous others indirectly, with some 85 percent hired
        from the local community. The Company is investing in training and
        skills assessments for the construction phase of the Project; and 
        
    --  Local supply - more than 600 local firms are suppliers / contractors
        to RMGC. 



Litigation



--  Over the years, certain foreign and domestically-funded non-governmental
    organizations ("NGOs") have initiated a multitude of legal challenges
    against licenses, permits, authorizations and approvals obtained for the
    exploration and development of the Project. 
    
--  The publicly stated objective of the NGOs in initiating and maintaining
    these legal challenges is to use the Romanian court system not only to
    delay as much as possible, but to ultimately stop the development of the
    Project. Often an action will be taken by the NGOs on a particular issue
    in several different regional court jurisdictions, and such legal
    objection may be raised in separate cases seeking a suspension or
    cancellation of a particular license, permit or approval. 
    
--  There were no significant legal developments during the third quarter of
    2013, save that on September 9, 2013 the Bucharest Tribunal dismissed a
    claim brought by two NGOs which sought the cancellation and suspension
    of the ADC for the Carnic open pit. This decision may be appealed by the
    NGOs. 
    
--  The High Court of Cassation and Justice ("Supreme Court") has admitted
    applications submitted by RMGC seeking the relocation from the Cluj
    Tribunal of four separate legal claims relating to the Project, namely
    those seeking the suspension and cancellation of the strategic
    environmental assessment ("SEA") endorsement for the Industrial Area PUZ
    and the suspension and cancellation of the ADC for the Carnic open-pit.
    These applications were submitted on the grounds of the association of
    certain members of the Cluj Tribunal with opponents of the Project. All
    four claims described below will now be heard by alternative Tribunals,
    with hearing dates yet to be determined: 
    
    --  On October 31, 2013 the action filed by three NGOs requesting the
        suspension of the ADC for the Carnic open-pit was relocated from the
        Cluj Tribunal to the Suceava Tribunal. 
        
    --  On November 5, 2013 a claim brought by the same three NGOs seeking
        the cancellation of the ADC for the Carnic open-pit was relocated
        from the Cluj Tribunal to the Calarasi Tribunal. 
        
    --  On October 25, 2013 a claim initiated by two NGOs seeking the
        suspension of the SEA was relocated from the Cluj Tribunal to the
        Bacau Tribunal.  
        
    --  On November 6, 2013 a claim initiated by two NGOs seeking the
        cancellation of the SEA was relocated from the Cluj Tribunal to the
        Covasna Tribunal. 
        
--  As previously reported, on April 1, 2013 the Bucharest Tribunal rejected
    a claim brought by an NGO which sought the disclosure of certain
    documents pertaining to the Rosia Montana exploitation license. On
    October 2, 2013, the complainant NGO submitted an appeal against this
    decision to the Bucharest Court of Appeal and the first appeal hearing
    has been scheduled for April 25, 2014. 
    
--  The most recent urbanism certificate, UC-47, was issued on April 22,
    2013. All four of the urbanism certificates which preceded UC-47 were
    the subject of legal action by NGOs, and, on August 14, 2013, three NGOs
    initiated proceedings before the Cluj Tribunal seeking the cancellation
    of UC-47. The date of the first hearing of this action has yet to be
    fixed and the location of the hearing, as in the cases noted above, may
    be challenged. 
    
--  Due to the inherent uncertainties of the judicial process, the Company
    is unable to predict the ultimate outcome or impact, if any, with
    respect to matters challenged in the Romanian courts. In all
    circumstances, the Company and/or RMGC will vigorously maintain its
    legal rights and will continue to work with local, county and federal
    authorities to ensure the Project receives a fair and timely evaluation
    in accordance with Romanian and EU laws. However, there can be no
    assurance that any claims will be resolved in favor of the Company, RMGC
    or the Project. The implications of a negative court ruling will only be
    known once such a decision is issued formally by the relevant Court and
    the position of the Government is assessed, and may have a material
    adverse effect on the timing and/or outcome of the permitting process
    for the Project and the Company's financial condition. 



Outlook



--  The Company's key objectives in the short term include to: 
    
    --  Consider fully the implications of the findings and recommendations
        of the Special Committee and, where appropriate, assist in the
        process to positive conclusion of issues raised; 
        
    --  Maintain ongoing engagement with the Government during the
        Parliamentary Review process; 
        
    --  Continue to highlight the key economic, environmental, social and
        cultural benefits brought to Romania by the Project in order to
        highlight the merits of the Project to all stakeholders; 
        
    --  Obtain approval of the EP; 
        
    --  Continue appropriate stewardship of cash resources; 
        
    --  Maximize shareholder value, while optimizing benefits of the Project
        for all stakeholders. 



About Gabriel

Gabriel is a Canadian TSX-listed resource company focused on permitting and
developing its world-class Rosia Montana gold and silver project. The
exploitation license for the Project, the largest undeveloped gold deposit in
Europe, is held exclusively by Rosia Montana Gold Corporation, a Romanian
company in which Gabriel currently owns an 80.69 percent equity interest, with
the 19.31 percent balance held by CNCAF Minvest S.A., a Romanian state-owned
mining enterprise. Gabriel and RMGC are committed to responsible mining and
sustainable development in the communities in which they operate. The Project is
anticipated to bring over US$24 billion (at US$1,200/oz gold) to Romania as
potential direct and indirect contribution to GDP. The Project will generate
thousands of employment opportunities. Gabriel intends to build a
state-of-the-art mine using best available techniques and implementing the
highest environmental standards whilst preserving local and national cultural
heritage in Romania. 


For more information please visit the Company's website at www.gabrielresources.com.

Forward-looking Statements

This press release contains forward-looking information as defined in applicable
securities laws relating to the Company and/or the Project (referred to herein
as "forward-looking statements") that are based on management's current
expectations, estimates and projections. Specifically, this press release
contains forward-looking statements regarding the development of a new legal
framework for mining in Romania, returns to Romania from the Project and in
respect of future permitting processes. All statements other than statements of
historical facts included herein, including without limitation, those
incorporated by reference, those which may refer to the Company's financial
position, business strategy, plans, objectives of management for future
operations (including development plans and objectives relating to the Company's
business) the economic impact, job creation, costs estimates, patrimony plans,
future ability of the Company to finance the Project, Project delivery and
estimates regarding the timing of completion of various aspects of the Project's
development or of future performance are forward-looking statements. 


The words "believe", "expect", "anticipate", "contemplate", "target", "plan",
"intends", "continue", "budget", "estimate", "projects", "may", "will",
"schedule", "potential", "proposed" and similar expressions identify
forward-looking statements. Forward-looking statements are necessarily based
upon a number of estimates and assumptions that are inherently subject to
significant business, economic, legislative, political and competitive
uncertainties and contingencies. 


Forward-looking statements are not guarantees of future performance and are
subject to known and unknown risks, uncertainties and other factors which are
difficult, or may be beyond Gabriel's ability, to predict or control and that
may cause the actual outcomes, level of activity, financial results, performance
or achievements to differ materially from those expressed or implied by the
forward-looking statements. These risks, uncertainties and other factors
include, without limitation, changes in the worldwide price of precious metals;
fluctuations in exchange rates; legislative, political or economic developments
including changes to mining and other relevant legislation in Romania;
geopolitical uncertainty, uncertain legal enforcement; changes in, and the
effects of, the government policies affecting the Company's operations;
uncertainties related to timelines for awaited approvals; changes in general
economic conditions, and the financial markets; operating or technical
difficulties in connection with exploration, development or mining;
environmental risks; the risks of diminishing quantities or grades of reserves;
and the Company's requirements for substantial additional funding.


Accordingly, readers should not place undue reliance on forward-looking
statements. Gabriel undertakes no obligation to update publicly or otherwise
revise any forward-looking statements contained herein whether as a result of
new information or future events or otherwise, except as may be required by law.



FOR FURTHER INFORMATION PLEASE CONTACT: 
Jonathan Henry
President and Chief Executive Officer
Mobile: [phone]
[e-mail]


Max Vaughan
Chief Financial Officer
Mobile: [phone]
[e-mail]


Bobby Morse
Buchanan
Mobile: [phone]
[e-mail]


Katie Fedorowicz
Investor Relations
Mobile: [phone]
[e-mail]